The construction chemicals market is poised to experience a growing number of mergers and acquisition deals in 2023

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Globally, the construction chemicals market is expected to record strong growth in 2023, owing to higher spending on infrastructure projects and increased focus on the affordable housing category. This, coupled with the demand for improved living conditions that are expected to drive renovation trends, will keep aiding the construction chemicals industry's growth.

As a result, ConsTrack360 expects the market to experience a growing number of mergers and acquisition deals in 2023. In the United States, several mergers and acquisition deals have been announced over the last few quarters.

• In January 2023, Beacon, the distributor of building products such as roofing materials, announced the acquisition of Whitney Building Products, the Boston-based firm that distributes commercial and multifamily waterproofing products. While the financial terms of the deal were not disclosed, the acquisition will enable Beacon to further expand its distribution network, thereby enabling the firm to capitalize on the projected growth in the construction chemicals market.

This is not the first merger and acquisition deal announced by Beacon. In Q4 2022, the firm also announced the acquisition of Coastal Construction Products, a Florida-based firm that distributes waterproofing products in the United States. The acquisition of Coastal Construction Products will also enable the firm to expand its distribution network. At the time of acquisition, Coastal Construction Products had 18 locations that were dedicated to serving the Southeast and Midwest markets with waterproofing products.  

The acquisition of Whitney Building Products and Coastal Construction Products will aid the future growth of Beacon and will also create an opportunity to leverage a coast-to-coast footprint to better serve customers across the United States, including in storm-exposed regions where waterproofing products are essential for building protections.

Over the last few quarters, several firms in the construction and other construction-related industries have been focused on expanding their distribution network. This trend is visible not just in the United States, but in other markets as well.

• Holcim, for instance, announced the acquisition of Quimexur in March 2023. The Latin American-based firm, Quimexur, is one of the leading producers of liquid membranes for roofing and waterproofing applications. This acquisition will drive the growth strategy of Holcim by enabling the firm to expand its presence in the Latin American region.

The acquisition of Quimexur follows the rollout of the GacoFlex TechoProtec line of products in the Latin American market. Holcim has introduced these products as a line of premium waterproofing and thermal isolation roofing products.

Alongside construction chemical-focused businesses, investment firms are also picking up stakes in the fast-growing segment, to capitalize on the strong growth potential of the market over the next five years.

• In September 2022, Flacks Group, a global investment firm based in the United States, announced the acquisition of Kelly-Moore Paint Company, one of the leading manufacturers of premium paints and coatings products in the North American market. While the financial terms of the deals were not disclosed by the firms, the acquisition is part of the firm’s strategy to build a strong portfolio of companies having a robust global distribution network.

As the construction chemicals space continues to offer a lucrative growth opportunity in the global market, ConsTrack360 expects more such mergers and acquisition deals to take place in 2023. Strategic collaborations and distribution partnerships are also expected to rise in the segment from the short to medium-term perspective in the global market. These mergers and acquisition deals, coupled with strategic collaborations to expand the distribution network, are expected to aid the competitive landscape in the construction chemicals market over the next three to four years.